Companies optimistic about Northeast Ohio's manufacturing future, survey finds
Most manufacturers in Northeast Ohio are optimistic about what the future holds for them in the next year, studies show.
MAGNET recently partnered with Kent State University, Wells Fargo, and Bank of America to conduct a regional survey that addresses the priorities and concerns of local manufacturers of all sizes.
Nearly 300 companies responded, spanning various industries and geographic locations. Of those manufacturers, 74 percent comprised C-level executives and general managers, with 89 percent of all respondents representing small and mid-size companies (businesses up to 250 employees).
These responses indicated the following:
Manufacturers remain confident about their sector.
57 percent indicated they anticipate some economic expansion, and over 50 percent expect their companies to grow over the next 12 months. Small and mid-size manufacturers with 26 to 250 employees were most optimistic, roughly expecting 80 percent growth. Conversely, 41 percent said they expect a flat economy, while another 3 percent are bracing themselves for a recession.
Small manufacturers expect revenue growth, while larger companies predict additional capital expenditures.
42 percent of small manufacturers surveyed expect more than 10 percent revenue growth (compared to just 14 percent of larger companies); however, 57 percent of mid-size and 48 percent of large manufacturers expect an increase in capital expenditures.
While many companies have embraced new technology, many have neglected 3D printing.
While 57 percent of regional companies are using some kind of automation (mostly Internet of Things technology and connected machines), only 15 percent of small and mid-sized manufacturers are taking advantage of additive manufacturing.
Most manufacturers in Northeast Ohio are facing similar challenges.
Respondents indicated they were “very concerned” about the following:
– Rising cost of healthcare (62 percent)
– Attracting and retaining qualified workers (65 percent)
– Government policies and regulations (56 percent)
Over 83 percent also reported it was “somewhat difficult” or “very difficult” to attract qualified candidates for existing vacancies, with their biggest challenge cited as lack of skills, education, and/or interest.
Salaries in manufacturing have increased and will continue to rise.
69 percent say their wages have risen over the last two years, while 77 percent indicate they expect the numbers to keep climbing. However, number of employees has roughly stayed the same, according to nearly half of respondents.
Larger companies struggle the most with turnover.
While 74 percent of smaller companies reported turnover under 5 percent, larger manufacturers over 250 employees reported rates of 10 percent or higher.
Small and mid-size companies are more open to using consultants.
Approximately 70 percent of companies under 250 employees reported using between one and five types of consulting in the past for lean manufacturing, HR, information technology, and other services. The three most popular topics included sales and marketing (54 percent), quality management and ISO systems (53 percent), and IT/ERP systems (49 percent). In the future, small and mid-size manufacturers are looking for strategic growth planning, lean/operations improvement, and sales and marketing services.
Article submitted by Bank of America For mid-market companies, business success and responsible growth aren’t mutually exclusive. In fact, prioritizing responsible growth is becoming increasingly important, and successful companies are making sustainability central to their growth strategies. Beyond good corporate citizenship, they are recognizing the intrinsic link between the strength of their business and that of the communities and economies in which they operate. Leading your growth with those goals in mind builds resilience and better solutions for the future. Consider the following: Responsible growth companies perform better. Companies that consider the impact of risks and opportunities on the environment, local communities and society may produce better financial results than those that don’t. Additionally, 90% of companies believe a sustainability plan is important for remaining competitive. Responsible growth companies attract investment. A 2016 study by MIT Sloan Management Review and Boston Consulting Group surveyed 3,000 executives and managers from more than 100 countries. Findings revealed that 75% of senior executives in investment firms agree that a company’s sustainability performance is materially important to their investment decisions, and nearly half would not invest in a company with a poor sustainability record. Ninety percent of executives see sustainability as important, but only
HEADLINE The survey definitively shows that product innovation leads to more growth, while “grow your own workforce” strategies will be needed to fill the major labor shortages hampering small manufacturer growth. Emerging technologies like the Internet of Things (IoT), 3D printing, and digital manufacturing are beginning to enhance innovation and productivity, but still have significant room for adoption amongst Ohio’s small manufacturing businesses. ABOUT THE SURVEY Under the direction of the Ohio Manufacturing Extension Partnership (Ohio MEP), MAGNET: The Manufacturing Advocacy and Growth Network conducted a thorough survey of Ohio’s manufacturing base. Contributing approximately 20% of Ohio’s jobs (and driving in some regions up to 50% of Ohio’s economy), and generating a disproportionate amount of export revenues and Gross Regional Product, manufacturing is critical to Ohio. Greater than 95% of Ohio’s manufacturers are small (under 500 employees), and these manufacturers need to remain competitive both nationally and internationally to ensure our economy’s health. Ohio’s Development Services Agency and the National Institute of Standards and Technology, which runs the MEP, recognizes the importance of this sector and fuels MAGNET and the Ohio MEP program to directly serve and support innovation, efficiency, and growth in small and medium manufacturers. What manufacturers need
How Virtual Reality and Augmented Reality Can Help Keep Our Engineers Safe and Our Manufacturing Strong Recall how difficult it was to put together complex LEGO creations when you were a child or helping a child. Now, picture assembling a fighter plane from a room full of parts. Even highly trained engineers can benefit from technology to help improve consistency and quality. Virtual reality (VR) and augmented reality (AR) are making near-perfect assembly a possibility in the manufacturing space. By wearing AR glasses that use cameras, depth sensors and motion sensors to overlay images onto the real working environment, engineers and factory workers can visualize the exact bolts, parts, part numbers and instructions on how to assemble a particular component correctly. Lockheed Martin began using AR goggles and improved F-35 assembly time by 30 percent, in addition to increasing accuracy to 96 percent. In order to remain competitive, businesses should consider the ways VR and AR can improve efficiency and supply chain productivity. According to a recent BofA Merrill Lynch Global Research report, AR platforms can provide companies up to 25 percent in cost savings on installation of equipment. Here are four ways VR/AR is disrupting the mid-market manufacturing space: